PHOTO-SHARING site Instagram is fighting to avert an exodus of users after a change to its privacy policy spurred a backlash by people concerned about their lack of control over how the company would use their images.

Under new terms of service, which come into effect on January 16, users grant the company a ''non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide licence to use the content that you post on or through the service''.

Geoff Holland, secretary of Electronic Frontiers Australia, said this meant that while ownership of the photo stayed with the person who took it, the company had a licence to use the image any way they liked.

It brings Instagram into line with the policies of other networking sites such as LinkedIn and Facebook, which bought Instagram for $1 billion in April.

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Dr Melissa de Zwart, an associate law professor at the University of Adelaide, said the photo subjects could end up on advertising billboards.

''You are giving them a blanket licence to do with it what they want,'' she said. ''We are in a bit of a bind because this is how we communicate, how we share information.'' The only option, she said, was to delete your account.

So that is what a number of celebrity Instagram users did. Singer Pink tweeted: ''i will be quitting instagram today. what a bummer. you should all read their new rules.''

Instagram's co-founder, Kevin Systrom, responded on the company's blog that by changing its terms of use the company, which has more than 100 million users, had merely wanted to ''experiment with innovative advertising''.

''Instead it was interpreted by many that we were going to sell your photos to others without any compensation,'' Mr Systrom wrote. ''This is not true and it is our mistake that this language is confusing. It is not our intention to sell your photos. We are working on updated language in the terms to make sure this is clear."

Mr Holland said because there was generally no right to privacy in Australia the only legal restriction on Instagram or Facebook using people's photos were if it painted them in a poor light, prompting a defamation claim. He said people in the photos had no claim on copyright.

Electronic Frontiers Australia's executive officer Jon Lawrence said all social media users were paying for a free service with their privacy.

''These are businesses and they need to make money and whether we like it or not some of these changes may make very good business sense to the companies,'' he said.

''People just need to decide for themselves if the value they get from the service outweighs what they feel is the privacy trade-off.

''If you're not paying for it then it's likely that you are the product.''